Latest news with #SoulPatts
Sky News AU
3 days ago
- Business
- Sky News AU
'Great undersupply' of housing in Brickworks CEO Mark Ellenor's sights after $14b merger with investment firm Soul Patts
The chief executive of Australian brickmaker Brickworks plans to capitalise on the 'great undersupply of housing' facing the country after recently revealing a $14b merger. Brickworks revealed a historic merger with investment firm Soul Patts on Monday, causing the share prices of the companies to rise 27.6 per cent and 16.4 per cent respectively. The merger undoes an arrangement from 1969 where each company owned large portions of one another's stock to defend from takeover bids. Both CEOs appeared on Sky News' Business Now, where Brickworks boss Mark Ellenor said the company was seeing 'some green shoots' in the construction sector and local economy, but noted there was more work needed to ignite growth. 'We've had an easing of inflation, unemployment numbers have moderated and we're seeing some growth,' Mr Ellenor said. 'We're definitely still at the bottom of the cycle.' He said two recent cash rate cuts from the Reserve Bank of Australia since the beginning of this year had led to some increased demand in Queensland, South Australia and Western Australia, but more populous states were lagging behind. '(In) our two core states of New South Wales and Victoria we've not seen that uplift as yet, but there's just a great undersupply of housing in this country,' Mr Ellenor said. 'We've underbuilt homes for the last four years and Brickworks (is) very well placed to take advantage of the upturn when it does come next year.' Soul Patts CEO Todd Barlow said he was confident about Australia's future, but noted some concerns about strains on the economy. 'We're not seeing any real signs of distress or emerging difficulties, but we're multi-years into a market that has not really generated increasing earnings across the whole market, yet we're seeing higher prices,' Mr Barlow said. 'That concerns us a little bit, but generally I don't see any major issues on the horizon for the economy. "We're hopefully positioning ourselves for some better opportunities ahead.' The Brickworks boss' comments come as dwelling approvals fell 5.7 per cent in April, according to the Australian Bureau of Statistics. The overall decline in April was driven by lower apartment approvals, per the ABS' head of construction statistics Daniel Rossi. 'A drop in apartment approvals drove a 19 per cent fall in private dwellings excluding houses,' Mr Rossi said. 'Meanwhile, private sector house approvals were up 3.1 per cent.' This followed a 14.4 per cent drop in March as apartment approval rates sunk compared to the start of the year. 'In original terms, 5,612 apartments were approved across March and April, compared with 8,625 approved across January and February,' the ABS said. The RBA's second cash rate cut of 2025 is expected to further the turnaround in house price growth after it slowed in 2024. Originally published as 'Great undersupply' of housing in Brickworks CEO Mark Ellenor's sights after $14b merger with investment firm Soul Patts
News.com.au
3 days ago
- Business
- News.com.au
Soul Patts and Brickworks agree to $14b merger
Diversified investment house Soul Patts is merging with its long-term corporate partner the industrials company Brickworks. The two businesses have had a unique cross-shareholding structure since 1969, with Soul Patts owning 43 per cent of Brickworks and Brickworks owning 26 per cent of Soul Patts. The merged business will be chaired by Robert Millner, the fourth member of the Millner family to run Soul Patts.
AU Financial Review
3 days ago
- Business
- AU Financial Review
Bricks-and-mortar ASX plays dwindle after Soul Patts' Brickworks deal
Australia is set for a surge in home-building in coming years, says former Brickworks managing director Lindsay Partridge. However, investors lack options to gain exposure to the sector, with five large building materials companies having disappeared, or set to disappear, from the ASX boards. Brickworks, the country's largest brickmaking group, has been a fixture on the ASX since listing 1962 but will soon depart the exchange after being swallowed up by investment group Soul Patts in a $14 billion merger announced on Monday.
CNBC
4 days ago
- Business
- CNBC
Stocks of Australia's Soul Patts and Brickworks surge after merger ends 56-year cross-ownership
Stocks of Australian investment firm Washington H. Soul Pattinson, also known as Soul Patts, and its affiliate Brickworks surged after both companies announced a A$14 billion ($9 billion) merger. Shares of Soul Patts traded 13.78% higher, while Brickworks, Australia's largest brickmaker, jumped 22.32% as of 1 p.m. local time. As part of the deal, a new company listed in Sydney will acquire all outstanding shares of Soul Patts and Brickworks. The merged entity is projected to be worth around A$14 billion ($9 billion), with holdings across real estate, private equity, and credit totaling A$13.1 billion. "Merging Soul Patts with Brickworks makes a lot of strategic and financial sense," Soul Patts CEO and Managing Director, Todd Barlow, said in a statement. He added that the deal "simplifies the structure, adds scale, and creates a more investable company." The merger will unwind a 56-year mutual ownership that was designed to fend off hostile takeovers and promote long-term investment strategies. Soul Patts owns 43% of Brickworks, while the brickmaker has a 26% stake in Soul Patts. However, critics argued that it suppressed shareholder value and corporate transparency. Brickworks shareholders are set to receive an implied value of A$30.28 per share, reflecting a 10.1% premium over the stock's closing price last Friday. Pitt Capital Partners is acting as adviser to Soul Pattinson, and Citigroup Global Markets Australia is advising Brickworks. The merger follows several unsuccessful attempts to unwind the cross-shareholding between Soul Patts and Brickworks, including a concerted effort by Perpetual Investment Management and venture capitalist Mark Carnegie between 2012 and 2017, which was dismissed after the Federal Court ruled that the structure was not detrimental to shareholders.
AU Financial Review
4 days ago
- Business
- AU Financial Review
US urges $40b defence spend; Soul Patts' $14b tie-up; Big bubble looms
Want to get this in your inbox at lunchtime every weekday? Financial Review subscribers can sign up for The Brief newsletter here. Plus start your day with our Before the Bell newsletter and read a full wrap of the day's news in Market Wrap. In today's news, the US is demanding that Australia add $40 billion to its defence budget, Soul Patts is merging with Brickworks, and AI stocks could become an even bigger bubble.
